Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/252080 
Year of Publication: 
2022
Series/Report no.: 
CESifo Working Paper No. 9563
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
We study how carbon pricing has affected inflation ex-post, using dynamic panel estimation of New-Keynesian Phillips curves for 35 OECD economies from 1995 to 2020. As carbon pricing we consider prices of emissions trading systems (ETS) and carbon taxes. We find that an increase in prices of ETS by $10 per ton of CO2 equivalents increases energy CPI inflation by 0.8 percentage points (pp), and headline inflation by 0.08pp, but has no significant effects on food and core CPI inflation. We also find that an increase in carbon taxes by $10 per ton of CO2 equivalents increases food CPI inflation by 0.1pp, but has no significant effects on energy CPI inflation, headline and core CPI inflation.
Subjects: 
climate policies
carbon tax
carbon emission trading system
climate change
inflation
JEL: 
E31
E52
E58
Q48
Q58
Document Type: 
Working Paper
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